Over the weekend, the SNP Government’s decision to withhold a £2.5 million Scottish Enterprise grant for a Clyde-based submarine welding centre laid bare its flawed approach to defence and industrial policy. Rolls-Royce had already pledged £11 million in specialist equipment for the facility, intended to deliver advanced welding techniques, reduce carbon emissions, and create hundreds of high-value jobs. Yet Holyrood classified the project as “munitions”-related, despite Rolls-Royce clarifying that its nuclear propulsion systems are not used for delivering warheads. UK Defence Secretary John Healey condemned the move as “student-politics” that will undermine vital skills development and cost generations of Scottish workers hundreds of decent jobs. In effect, by grouping any submarine-adjacent work under a blanket anti-munitions policy, the SNP has chosen ideological purity over Scotland’s economic and security interests.

The question for Scotland is whether our engineers, welders, and high-tech firms will benefit from the surge in UK defence spending, or be shut out by Holyrood’s self-indulgent obstruction.

At our recent Spring Conference, Scottish Liberal Democrats made clear that defence is not some distant “Westminster” issue but a core driver of Scotland’s industrial future. With the MoD already investing over £2 billion per year here, supporting more than 12,000 skilled jobs, our motion demanded that Holyrood engage constructively with Westminster on procurement frameworks so Scottish business can compete for MoD contracts. We also called for the Scottish Government to work with the Scottish National Investment Bank (SNIB) to allow targeted support for non-nuclear, dual-use projects, such as sonar-technology R&D, advanced propulsion, and unmanned underwater vehicles, without funding nuclear warhead production. Despite SNIB’s November 2024 policy change, it still excludes any firm involved in submarine programmes, effectively blocking seed capital for precisely the kind of innovation Rolls-Royce’s welding centre would have delivered.

Instead of cutting aid or social services to pay for defence, as the Labour Government has done, we will press for alternative revenue streams, including a modest Digital Services Tax on technology giants or the creation of publicly guaranteed “Rearmament Bonds” to leverage private capital without undermining our international obligations. Crucially, we will work with colleges and universities to expand courses in naval architecture, cyber-security, and robotics, giving young Scots clear, respectable pathways into high-value STEM careers.

The SNP’s categorical refusal to support a welding facility that would not produce weaponry but underpin our submarine fleet illustrates a broader political immaturity. While they posture about anti-nuclear principles, their blanket ban on anything “submarine-adjacent” effectively cedes leadership on innovation to other UK regions and weakens Scotland’s bargaining power as the SDR’s work-horse. In contrast, Scottish Liberal Democrats offer a pragmatic, grown-up alternative: one that respects ethical boundaries on nuclear weapons but embraces the broader economic and security benefits of non-nuclear defence investment. It is time for Holyrood to move beyond headline-chasing gestures and choose substance over symbolism so Scotland can seize the industrial and strategic prize that the SDR promises.

* Neil Casey is Vice Convener - Policy, Scottish Liberal Democrats. The views expressed in this article are those of the author and do not necessarily reflect the policy of the Scottish Liberal Democrats.